On Section 3, I should like to ask the Minister if the definition of the word "cement" as meaning Roman cement, Portland cement or any other hydraulic cement includes white cement and rapid hardening cement?
Cement Bill, 1933—Financial Resolution. - Cement Bill, 1933—Committee.
Sections 1 and 2 put and agreed to.
SECTION 3.
Yes.
I do not know whether the Minister envisages the company manufacturing Portland cement, white cement and Roman cement. I very much doubt that. I do not suggest that the Minister should not have power to include these cements if necessary, if they have to be thrown into the pool, but I suggest that he might as well leave them out for the present. They are very small items and only mean additional confusion to the trade for a long time.
Obviously we could not leave them out now, because it would mean introducing another Bill to insert them at the stage when we were getting cement produced from works here. At that stage undoubtedly we shall have to have power to regulate all kinds of cement coming in, so as to ensure that the stoppage of imports of one kind would not be offset by considerably increased imports of another kind which conceivably might occur.
It is quite preposterous that anybody would use white cement instead of Portland cement, or rapid hardening cement. They are in distinct classes by themseleves and there is absolutely no fear of one being substituted for another. They could not be.
It is not preposterous. Somebody would be able to get cement within the definition that would be suitable for the other purposes. I think the Deputy himself has some experience of the ingenuity of persons desiring to import articles in avoiding Customs definitions. We have to cover all classes of cement in order to ensure that we shall have the position under control.
I cannot quite agree with the Minister when he speaks of the ingenuity of people with regard to Customs duties. I should like to point out that the fault is not all on one side. There are some dreadfully loose definitions of things. In fact, I think people are not yet clear as to what a number of things in the Customs Act of 1932 really mean. I suggest to the Minister that it is a closer definition of articles that he really wants. However, what I am driving at is this, that everything but Portland cement ought to be omitted from the scope of the licence for the present.
I contemplate that licences will be issued on demand. For the present there will be no restriction on the importation.
Sections 3, 4, 5, 6, 7 and 8 put and agreed to.
Question proposed: "That Section 9 stand part of the Bill."
Would the Minister say if any applications have been received up to the present.
There have been, of course, no applications made yet. The Bill has not yet been passed. Formal application in the sense meant here has not yet been made, but a number of groups have intimated their intention to put forward proposals under the Act, and those are proposals which no doubt will be the subject of applications later. In the meantime of course, we will have a large part of the process of examination dealt with.
I take it, arising out of what the Minister has said, that there are certain things that really are not mentioned here and would immediately occur to the ordinary individual. The Minister mentioned, when introducing this Bill, a cement factory for the eastern section of Ireland and a cement factory for the southern portion of Ireland, possibly followed by a cement factory in the west. It occurs to me that any person who is putting up a cement factory might say to the Minister: "I am going to put up one factory in one part of Ireland and supply the whole of the country from that." Is that going to be a question of providing negotiation between the Minister and the manufacturers, or is that going to be inserted in the Bill?
There is another question that occurs to me which the manufacturer would raise with the Minister and I see no mention of it here. You have in Northern Ireland a factory that could go very near supplying the whole needs of the country. I take it that the Minister does not look upon the end of importation as impossible. In that way you might have a factory inside the boundary, and I take it that the Minister in negotiations would make it perfectly clear that that position would not be afterwards prejudiced.
As far as the output of a factory is concerned there is power in the Bill to fix a maximum output, and make that a condition of the licence. That would probably be done, but at the same time it seems to me that, provided we do not merely issue one licence only, there is no reason why we should not allow a factory to make as much cement as it likes. Suppose a man comes to me and says: "I am prepared to build a factory in County Mayo to produce 200,000 tons of cement." I might tell him "go ahead, but we are going to give a licence for a factory in the east and for a factory in the south, and you will have to sell in competition with them." That might be decided, but ordinarily the intention would be to put a maximum limit on the output of a factory, so as to ensure that although some element of competition might be there, the total sold under all the licences would be equivalent to or somewhat in excess of the total estimated requirements of the country per year.
If it is suggested that a factory had to work between a maximum and a minimum prescribed output, that they had to guarantee a minimum and could not go beyond a maximum output, they would be in an extraordinary and very onerous position. Perhaps I am discussing Section 12; I will wait until that section is before the House.
On sub-section (b), the word "area" would, I imagine, want further definition. The sub-section refers to "the area within which the applicant proposes to manufacture cement." Does the word "area" refer to the site of the factory or to the area within which distribution will be afterwards allowed?
What we would require would be an indication as to the place in which it was proposed to engage in the manufacture of cement. That might not necessarily be one point; there might be a quarry in one place——
In which is the distributing centre.
All in the same area but not necessarily at the same point. The applicant will state where he proposes to do the manufacturing.
It will be in the recollection of those who were present when this matter was before the House on the Second Reading that a question arose regarding recommendations to the Minister to remember the late cement works in Wexford. Deputy Corish made a statement that those works ceased when the Dublin Corporation stopped ordering cement from them. Deputy Good, who was here, suggested that it was a long time anterior to the period mentioned by Deputy Corish that those works had closed down.
I would draw the Deputy's attention to the fact that we are discussing Section 9 of the Cement Bill, which deals with applications for cement manufacture licences. Discussion must be confined to the section.
I heard them speaking about areas. I have not read the Bill and I have not read the amendment. I am always in a position of very blissful ignorance here, but when I heard them mentioning certain areas— the Minister was asked a question and he replied—I thought I might state distinctly what occurred in connection with the closing down of the Wexford works.
It would not be in order to discuss it here.
Will you tell me when it will be, please?
That is not the function of the Chair.
That is the position I am in. Somebody will have to direct me at least for the first six months.
I will.
The Minister has promised to do so.
Is it the intention that these three cement factories are to be run by three different organisations, or can they be run by one group?
They can be run by one group. There is no restriction on the Bill on that matter; it might be three, it might be one, and it might be two. Our intention is to examine whatever applications are made, and accept those which appear to be most attractive from the point of view of the country.
Does that mean that a firm in Cork might run the three?
Possibly.
You are managing enough without running the whole of Ireland.
There is just one point I want to have cleared up. The applicant has to state the area within which he proposes to manufacture cement. The Minister was asked whether that word "area" had definite reference to the area from which the material was to be drawn, which would seem to be indicated by the use of the word "manufacture," or whether it had reference to the distribution area. The Minister's reply was somewhat vague. We might envisage a situation in which there might be two or three factories. The total output of the three companies might be somewhat in excess of the amount laid down as the total output in the country. Let us assume that there are three factories and that we would want the three, each producing 100,000 tons. Each is to get, according to the Minister's statement, a licence for something more. Let us suppose that each gets a licence for 250 tons extra which would leave a surplus of 750 tons in the whole country. That is all manufactured, but one can manufacture cheaper than the other two. Are we to have a provincial tariff to protect sales?
I think the transport cost would prevent that.
But suppose it did not.
There might be competition.
Then we would have one factory selling 100,000 tons and the others left with some on hands. Suppose that continued for some years, and it was demonstrated that one factory could distribute apart from its base, what would the output then be placed at? Is there a possibility of putting that into the Bill?
No.
That means that there is to be amending legislation. Is there any way of doing it in this Bill?
No.
Then how could it be done?
If one of the companies went out of business.
Then the licences are fixed and immutable.
May I ask the Minister how far he would be prepared to grant to a cement manufacturer the total output of the country? Because I do not think he will get three factories put up, in different parts of the country, to produce what is required. I think Deputy McGilligan has rather overstated the imports. I think they amount to round about 200,000 tons for the whole of the Saorstát.
They are more than that.
Can the Minister tell us how he would deal with that situation? It appears to me pretty clear that a manufacturer will not be long in discussing this matter before he says: "If I have to face competition I may as well know what the competition is that I have to face."
We do not contemplate their having to face competition to any great extent, except so far as the quantity required in any one year is less than the aggregate amount licensed for all the factories. Each factory will endeavour to dispose of cement up to the maximum permissible. I agree we will not get the industry started at all unless we are prepared to contemplate some monopoly conditions.
I quite agree, but a manufacturer may come in and say I want to start on monopoly conditions. I reserve the right to put up one, two or three factories, but I must have the total output of the country.
He might be told there is no business doing.
It is well to get even that information.
Section 9 put and agreed to.
Sections 10 and 11 agreed to.
Question proposed: "That Section 12 stand part of the Bill."
On this section 1 assume that the Minister takes power here to insist that the quality of the cement manufactured at each of the factories is of the present standard specification.
We might insist upon something higher. The British standard of specification is ordinarily accepted by a number of manufacturers of cement at present. We would undoubtedly fix a specification, certainly not lower than the British, and possibly, if investigation showed that the raw material justified it, we might fix a higher specification all round. There will be a specification that will ensure the best quality cement that can be procured by modern machinery.
Of not lower quality than the native product?
What does the Minister mean by a somewhat higher standard?
We may improve on the British specification as a number of other manufacturers are doing.
We might put a few gold ounces into it.
Not a bad idea, when we discover our mine.
The rise and fall of commodity prices upon the market depend upon the cost of labour and fuel and other things of that kind. How then fix maximum prices?
They will ordinarily be subject to fluctuation, if fluctuations occur. The maximum price would be one chargeable when the cost of fuel, labour and electricity were at a certain point, and would be subject to increase or decrease when these costs rise or fall.
Section 12 agreed to.
Section 13 agreed to.
Question proposed: "That Section 14 stand part of the Bill."
When considering the question of licences would there be any opportunity of considering the proposals before the licences are granted? Of course these factories would involve a very large expenditure of capital on the part of the different licensees. It would be necessary, before that capital was expended, to have some scrutiny into the proposals.
Capital will be expended by people who get the licences.
But before the concession is granted will the Minister be under any obligation to bring the proposals before the House?
I think that would be undesirable. If we put that condition in we would probably get no applications at all. Some firms would be reluctant to give in public information that they would be prepared to give in private, but I think we should publish to the Dáil when the arrangement was arrived at the fact that a licence was given to a particular firm to manufacture cement of a particular class and in particular quantities. All that information would be given, but that would be after the licence had been given.
I am just recalling the facts in connection with the establishment of sugar beet factories which the Minister knows were somewhat analogous. There, of course, considerable concessions were given and the whole matter was discussed and debated here, as the Minister is aware.
We are giving no concession except this concession—that we permit them to manufacture cement.
And charge a high price. That is the great concession.
On the contrary, the licence will be given to those who undertake to charge the lowest price.
The lowest price under licence will be somewhat of an addition to the lowest price at which cement can now be purchased.
It might not.
The Minister's whole speech was on the basis that it would.
Since then I got some additional information. The price of cement went up recently.
Could we have an adjournment of this debate until the Minister makes up his mind on this matter? He introduced a Bill in the month of November which derided this proposal of manufacturing cement in the country. Then we got a Second Reading speech based on this idea— that we were getting cement at far too cheap a rate from outside countries, that those outside countries were losing money on the business, that that was a scandalous thing, that that might be ended by them some time and that, in order that it should end, the Minister would make it end immediately. Now the situation is changed and we are to get the cement more cheaply.
Do I understand that no opportunity will be given to the House to express an opinion as to whether a licence should be issued or not?
No.
A concession will be given without consultation with the Dáil?
We are asking the Dáil to authorise the issue of licences under these circumstances. I think that it is essential to do that if we are to get the industry established.
I should like if the Minister would develop this question without disclosing anything that he thinks would be detrimental. We should like to know if he thinks that the maximum price will be anywhere near the world price. The Minister said that he was giving nothing away. Deputy Good suggested the other evening an addition of £1 per ton on the present price. Costs fluctuate, but would the Minister say what the factors would be in considering the fixed maximum price? Electricity and labour have been mentioned. I do not know whether the Minister could give a closer indication or not. It would relieve the minds of a lot of people to know that cement was not going to increase considerably in price in the period intervening between now and the opening of a factory.
I think I can say this— none of the people I have been in touch with contemplates a price higher than that in most European countries. The price mentioned in every case was substantially less than that prevailing in a number of European countries. I admit that that bears no relation to the price at which cement is being imported into this country. Russian cement is coming in here and is being delivered at 27/6 per ton.
I do not think that there is much Russian cement coming in.
The Deputy might be surprised. It may not be coming in under that description but the Deputy may be misinformed. There is not, of course, a large percentage.
What would you call "large?"
In my opinion, 3,000, 5,000 or 10,000 tons would not be large.
Coming from Russia?
Yes.
Is it coming into the port of Dublin?
I did not say that.
It is only a red herring.
To-day, I have information of a consignment being quoted at 27/6d. or 28/6d. per ton. That is not for a large quantity and the prices may have been cut specially because of the circumstances that exist. I do not think that we can get cement as low as that in future. We might get cement produced at that price but by the time we shall have got it packed and delivered, it will be somewhat higher than that.
Perhaps the Minister would say what his standard was with regard to the price quoted in relation to the price at which cement is purchasable in other countries.
I think that we shall have cement here substantially cheaper than it is at present being produced in other countries.
What relation will that price bear to the price at which we are now buying cement?
As to what price we are now buying cement at I am not clear.
What relation will it bear to the price at which we were buying cement when the Minister said on the 4th May that we were getting cement at about half the price at which it was obtainable in the country of production.
That is a different question.
That is the important matter.
It would be difficult to to say at what price we can now buy cement because prices are fluctuating considerably. There was an upward tendency in recent weeks but that appears to be reversed now. We were getting cement very cheaply but the price is fluctuating. I do not think that we can possibly get home-produced cement as cheaply as we are getting some of the cement coming in here. We can, I think, get it more cheaply than that same cement is being sold in the country of production. I certainly do not contemplate any substantial increase in the average price of cement following the introduction of its manufacture here.
Would the Minister mention a figure per cwt. by which it will not exceed the present price?
I do not want to mention a figure. A number of people have undertaken to put up proposals for the establishment of factories here. The attractiveness of these proposals will depend on the maximum prices which the persons concerned will guarantee. The lower they go the better.
Does the Minister really say that there is room for more than one factory in the country?
Undoubtedly.
On an economic basis?
Yes.
Does the Minister remember that on the 17th November, in relation to the project he was then fathering, he said the advantage of that project was that we would get cement sold here at a price ex-mill substantially lower than that prevailing?
I think that that is true. In fact, I had that offer quite recently.
It is true that under the previous proposals most of the employment that would be given in the whole cement operation would be given by the minor operation, and under that proposal we would get cement sold ex-mill at a price lower than the price prevailing?
The price has gone down very much since then.
We were getting it at half the price at which it was procurable in the country of production, but we are going to pay considerably more than that henceforth under this proposal. I suggest that the Minister should take another adjournment and think well over these proposals, both of which were put forward with so much enthusiasm by him.
I think that this question of getting cement produced here has been adjourned long enough.
It would be better that it should be adjourned further than that we should have this hit-and-miss policy.
We have hit this time.
You are going to hit the consumer, but that is not the aim.
I suggest that we get back to something concrete. The question before the House relates to Section 14, which deals with the revocation of cement manufacturers' licences and has no relation to Russian cement or to past, current or future prices.
The Minister can only revoke a licence if the person concerned applies to have it revoked or if there is an offence committed. Would he not think of adding a condition providing for revocation of the licence if the person charges a price higher than——
That would be a breach of the condition.
I am trying to get it discussed.
The Deputy cannot possibly get into order in that way.
I think I can. In fact, I think I am in order at present in this particular discussion. There was a proposal held out under another proposition that we could get cement at less than the price prevailing here. We are now faced with a particular scheme in which the Minister is going to allow a minimum to be charged higher than what now prevails. Supposing that the minimum or the maximum be increased, is that a breach which will warrant revocation? Is that the only hold the Minister has; revocation of the licence?
The previous section provides for a fine.
What the Minister is up against is that there are three institutions to be established here, each with a capital of £400,000, involving £1,200,000. Supposing the Minister gets an indication of a ring, and there are all the conditions essential to a successful ring, and finds prices growing, he is faced with the proposal either to revoke the licence or to fine and fine until he gets the thing done. Then he is immediately faced with throwing out 400 men from each place into the coldness of the world which will cost far more than the little extra price charged to the unfortunate purchasers of cement. Is there any way of getting some outside intervention in all this, not revocation of the licence, and not a fine, but letting in a certain amount of cement against the people operating here?
That is provided for. At any time we can do that.
And that will be put to people going to manufacture here? Is it quite clear that the one thing they will have in front of them is that they are breaking through the maximum price, and that if they go higher then there can be a flood of imports? That is a better situation. I wonder will we get the business.
Section 14 agreed to.
Question proposed: "That Section 15 stand part of the Bill."
I notice in the section a French expression, profits a prendre. Is not that against the laws of the House?
Section 15 agreed to.
Question proposed: "That Section 16 stand part of the Bill."
In connection with this section dealing with compulsory acquisition orders, do I understand that the Minister will take from the owner of the land the right to work rock which is probably not suitable for cement?
The intention of this part of the Bill is to provide for difficulties that may arise in the construction of cement works. These works are very big. Ordinarily, I think we would have to assume that anyone proposing to establish the works would have to promote Private Bill legislation, in order to get power to acquire land, to work tramways and, perhaps, overhead rail or rope ways. In order to avoid the delay and expense associated with Private Bill legislation we put this section into the Bill which enables the Minister to give the power by order, when certain conditions prevail, following local inquiry. In fact, I think we will have to introduce an amendment to this section on the Report Stage if, after examination, it is not clear that the right to operate railways and so on is conferred. It can be reasonably assumed that a branch line or a railway siding will be a necessary adjunct to any cement works. We may have to introduce an amendment to deal with that. All we intend to provide here is the right of acquisition of land necessary say in the construction of a railway or in a development of the works. I do not contemplate that we would give an order for the compulsory acquisition of land under which there is a limestone deposit. If there was any such order necessary it would be given under the Mines and Minerals Acts and not under this Bill.
The Minister will settle with the parties to whom he is going to give the privilege of manufacturing cement. I suppose they will then be allowed to go round the country testing different limestone rock, and deciding which is the most suitable. If they find that rock in a certain area is suitable, the Minister will commandeer it irrespective of the rights of the owner.
No.
What is to be the programme?
The Deputy understands that we have power already, in the case of persons wanting to work minerals who are unable to get agreement with the owner because of difficulty about the price or because the owner is not available or that there are a number of small owners. We have power to give a licence to work under the Mines and Minerals Act which was passed in 1931.
To acquire compulsorily?
Yes, in the case of minerals. The power mentioned in this Bill does not relate to that. Assuming that a company has determined to make cement at a particular place where they have the raw materials, they may have to erect a railway sliding to get connection with the nearest railway or an overhead ropeway. The company could obviously be bled by people round about. They might be charged an exorbitant price or be held up indefinitely by difficulties such as locating the owner of the property or something of that kind. It is to meet difficulties of that kind that this section is inserted. In other words, this Part of the Bill is similar to the type of Private Bill introduced by the tramways company, or by large-sized undertakings of that kind, where such difficulties had to be contended with. This is quite common form in Private Bill legislation. Ordinarily, we would leave it to people to get these powers by Private Bill legislation. In this case we assume— and I think rightly—that such legislation would not be defeated if the Government had given a licence to the people to manufacture. In any event we do not want action delayed, or to put upon the licensee the expense involved. That is why we provide for a Ministerial order following an inquiry.
Limestone will be a mineral within the meaning of the Act?
I am afraid that is a point yet to be determined.
It appears to me that between the two a man on whose land there is limestone is going to be squeezed.
No. I would not contemplate the use of these powers for the purpose of acquiring the deposit at all.
It is important that the Minister should look into it. The first query will be: Is limestone a mineral?
Sections 16 to 19 inclusive agreed to.
Question proposed: "That Section 20 stand part of the Bill."
In Section 20, I notice that the Minister may appoint an officer to hold a public inquiry as to the suitability of sites.
No, a public inquiry only as to the exercise of the power of compulsory acquisition. If there is a proposal to acquire compulsorily a piece of land in connection with a cement works then a local inquiry may be held.
Section 20 agreed to.
Question proposed: "That Section 21 stand part of the Bill."
Although the Minister may contemplate Part IV being temporary, and being done away with when the cement factory is working, still the simpler the working of the Bill is made during the intervening period the better for everyone concerned. I suggest to the Minister that he should simplify the licensing regulations. He is, no doubt, aware of what has occurred where licences have to be obtained for other materials. It is no uncommon thing to find that when a licence is issued for a certain quantity the importer has to take a ship which would hold twice that quantity. He goes back to the Minister and, by the time he has got his licence altered, the ship has gone. There are other variations of that and it is the commonest thing to find that the market has risen because, whenever there is any delay, a person nearly always finds that the market has gone against him. I would suggest to the Minister, if he could in any way see fit to do so, to give some sort of a general licence which would be flexible within certain limits and for certain times. This principle of getting a licence within a very narrow period, in which the maximum and the minimum are strictly controlled is not conducive to good buying for the quantities that are required nowadays.
There is another point about which I should like to ask the Minister. Of course, I can see no difference between a licence, upon which a person will have to pay, having regard to the number of tons he will import over a certain period, and an import duty on cement. I have adverted earlier to the fact that it would be very desirable, as soon as possible, that the people should know what they have to face. I should like to ask the Minister does he contemplate charging different rates on cements coming from different countries and does he contemplate charging cement from the same country at different rates where the purchase price is different? In other words, what is the Minister's basic idea in charging an import licence? If it is merely to cover a very small cost in connection with the administration of the scheme, I scarcely think that it is worth while to fix a considerable duty, because that is what it comes to, that is going to be placed on cement. I should like the Minister, if possible, to give us the underlying principle, at least, in which it would be calculated. Does the Minister wish to bring the cost of cement to a common denominator in this port? The Minister has spoken of Russian cement that was bought at 27/6 a ton. Would he put £1 a ton duty on that and 2/6 duty on cement from another country? I should be very pleased to have enlightenment on these matters from the Minister.
Undoubtedly, it would be much simpler if we just put on an import duty and had a licence provision, but it would not serve our purpose as well as the scheme in the Bill. In so far as the scheme is complicated, it is so perhaps because of an undue anxiety to impose a number of safeguards such as the provision about the publication of licences and the conditions attaching to them and with a view to ensuring that the same conditions will apply under similar circumstances to all people. In fact, however, what the Deputy says is correct and an import duty with a licence provision would be equally good. We could have an import duty on goods imported at any time to any port unless there was granted a licence to import free. That is not what we want however.
In order to make this scheme effective, we must have power, first of all, to permit cement to come in to one part of the country through particular ports and not through others. If we had a cement factory, say, in Cork, established six months before a factory established in some other part of the country was in production, we would have to prevent it coming into the area served by the Cork factory. There might also be question of the price at which cement will be available at the factory in production. There might be a great disparity between that and the price of the cement that is imported. In order to prevent that disparity we take power to impose those fees. The purpose of the fees being to secure that the price of the imported cement will be uniform with the price of the home-produced cement, on the assumption that the importing firms would be prepared to continue dumping cement in here at uneconomic rates. If they were not doing so ordinarily there would be no other restriction on the importer of cement than that he had to get a licence. It is only in the case of cut prices that there would be any question of a fee.
We had to devise a system that gave us control not merely of the imports but also gave us control as to the point of entry here and we had to have a system designed to secure a level price and also certain power in the matter of the country of origin. At the present time, apart from the emergency duty on British exporters, there is no restriction on any country. It is conceivable, in view of the way in which world trade is developing that we may have to follow the example of other countries and to make special bargaining arrangements with other countries, by which we might agree to take a defined quantity of cement in return for a defined quantity of butter. We do not contemplate developments of that kind for some time and unless the forthcoming London Economic Conference was a complete failure it would hardly be likely that such arrangements would be made, but there would be power to do it here. There are three main reasons for this, one, to get cement produced here by being in a position to restrict imports; two, to be in a position to direct imports, in so far as they are allowed in at all, into particular parts of the country; and three, to see that there will not be any great disparity in price. We will probably try to raise the price of cement from the present level up to the level at which Irish made cement will be made available on the figures mentioned in the licences for a period of time, in preference to having a sudden jump, if there is to be a jump. We could start gradually raising the price of cement by the operation of these fees in order to avoid that jump. It is quite conceivable that we may not be able to raise the price in view of the fact that dumping may have ceased by that time.
I am pleased to hear the Minister's reply, because I take it that unless some special and extraordinary circumstances arise, he is not going to impose different duties or different licence fees—I call them duties and it does not matter much what you call them—on cement coming from various countries.
Yes, only for some special consideration.
I accept that. I do not know whether the Minister can give us any idea as to what price he has in his mind as an import duty. According to his own statement, I take it that the Minister is not going to charge any duty until he sees that cement is below the price that the Irish cement would probably be sold at in this market. Is that the object?
Nothing substantial.
But that is real all the time—that the imported price would be lower than the Irish manufactured price.
The Minister held out no hope on the Second Reading.
It is not so long ago since it sold at 50/- a ton here.
What kind of cement?
British standard specification.
The streets of Dublin were plastered with it.
They are not plastered with it now.
Not at that price.
I welcome that part of the Minister's explanation, because it clears up a certain amount of misunderstanding. I would still urge on him that if these regulations are to be carried out in the way laid down here, then I would describe that as being an unnecessarily clumsy way of bringing about the object the Minister has in view. If the Minister wishes to control cement in a certain area he can very easily impose a condition in the licence that it will not be sold outside that area. In other words, if there is a cement works producing in the eastern portion of the country, and he still wishes to leave the south and west to get in cement, I think it would be necessary and desirable and less clumsy if he imposed a restriction that the cement was not to be sold outside a certain area.
I am afraid it would be very difficult to do that. In fact, in another connection I had experience of how easily a condition of that kind can be evaded.
I would like to discuss that with the Minister.
Would the Minister say why it is necessary, in the period between the present and the setting up of these factories—of their putting testing material on the market—to put a charge on cement coming in. Why is it necessary to license it? Why is it proposed to penalise building?
I would not describe it as that.
Of course, the Minister does not see it from the same point as I do. Any additional cost that is put on cement will increase the cost of building, and if there is an increase in the cost of building, then less building will be done. This scare, if I may so call it, in connection with cement—this unrest is having reactions in the industry. Take the case of people who, at the moment, are contemplating the expenditure of considerable sums of money in building. If the price of cement, which is a very important item in building, is likely to be raised in the future, then these people will seriously consider whether it is desirable to proceed with their building. That condition of things is having reactions on the industry at the moment. What I am anxious to point out to the Minister is this: between the present period and the setting up of these factories, why is it necessary to cause this uncertainty, this instability, if I may so put it, in the industry? I do not know that the Minister for Finance is going to derive very much benefit from it. It would be unfortunate if he should, because if so, it is going to increase the cost of building and lessen the amount of building work done. It would also, of course, increase the amount of unemployment, which would be very undesirable.
I would like to make the Minister's answer for him, not as he will make it to-night, but as he did on the 4th May. Deputy Good asks why, prior to the erection of cement factories in this country and before they are in full working order, we should have a licence fee charged on the cement coming in. Here is what the Minister said on 4th May:
"We must be prepared to contemplate a rise in cement prices following the establishment of that industry."
Later on he said:
"We do not want a sudden increase in price."
In other words: we do not want the people suddenly to realise that we were getting supplies from outside at so much per ton, and that there will now have to be a big increase in price. The Minister has a better plan: to increase it by an odd shilling here and an odd shilling there by way of an import licence and of getting people used to the fact that cement really is a thing that they ought to pay so much for. It is in that atmosphere we are getting our Irish cement industry.
A very lucid explanation.
That is not the answer the Minister will give to-night, but that is the answer he gave on 4th May. Deputy Good then asked, by way of reducing this to an absurdity, if the Minister was looking to get any advantage for the Exchequer from this import licence, and said that if so then he was going to place a very serious imposition on house building. The Minister faced up to that frankly on the 4th May and said:
"In any event I see no reason why the benefit of the price cutting war going on at the present time should not accrue to the Exchequer."
He also said:
"If foreign countries are insisting upon selling us cement at a loss there is no reason why the full benefit of that reduction in price should be enjoyed merely by those who buy it."
A scandalous system of economics— that only those who can buy cheaply should get the benefit of that cheap purchase.
We are spending more on house building than anybody else.
"Out of public funds a very large amount is being spent at the present time to secure the construction of roadways, houses and other buildings." In other words: on our election posters we will be able to say that we supplied so much for housing, but we will not say a word about the little bit of extra charge put on in the case of cement. No, but other people will say it for you. We are getting the two sides of the case presented to-night. The Minister is now trying to run away from some of the things he said on the 4th May. He is not at all certain that the price of cement will not rise. The whole basis of his argument on the 4th May was that we were living in a very unsafe and insecure position: that foreign people were selling their cement at lower than the cost of production in their countries: that that was a scandalous business and might stop one of these days, and for fear it would stop soon we would stop it immediately. That may not be the complete argument the Minister used then but it certainly is not a perversion of it. The other things which flow from it came out with the utmost naivete—that we do not want to give the people a shock by a sudden rise in the price of cement or wish them suddenly to realise the difference in price when cement is being produced here compared with what it was when brought in from abroad. The policy of the Minister is to raise it bit by bit—to drug the people into insensibility. The Minister's answer on the 4th May frankly revealed as I said at the time what I considered to be a mad system of economics. I cannot see why we should not let the madness operate in some cases to our advantage in the peculiar system we are in, instead of operating always against us. We are having it definitely to our disadvantage in the case of butter and we are having it a little to our advantage in respect of cement. Why should not we have a balance? We are going to pay a little bit extra by reason of having three distributions instead of one; consequently, we must have an import licence.
Deputy Dockrell seems to have misunderstood the effect of this section we are discussing. He referred to it as a temporary method. It is temporary only in a very limited way, temporary in this sense that it will be only for a period that any licence will be granted for importation. That is what is envisaged but otherwise the licence is full and complete. The Minister answered me on another paragraph, and he will understand that what I have said is accurate enough, that the import duty and the fee charged on the import licence are only going to be prior to the establishment of our cement industry. After that, all these import licences will be done away with and nobody will be allowed to import cement. Nevertheless should that newly-established Irish industry—under foreign control I believe—raise its prices to an unreasonable degree then we will start the importation of foreign cement once more. I would like to have that repeated here because it is certainly a matter which should be brought to the notice of those who are going to make cement here at this enhanced price—the fact that there is a limit to the price they can charge, and that if it goes beyond a certain figure the full tide of imports will be allowed to flow in upon them. That is the one chance we have of keeping down their prices to something like an economic figure.
What Deputy McGilligan has said to Deputy Good on my behalf is accurate enough. We do not, however, propose to increase the price of cement immediately by the full amount that Deputy McGilligan contemplates. As for its effect on housing I would again remind the Deputy that a £450 cement house built under the Housing Act of 1932 would be increased in cost by one-half of one per cent. if cement is increased by 4/- per ton. Therefore, the increase in the cost of housing having regard to the fact that the total increase in the price of cement would not be much more than 4/- is very slight indeed.
Suppose it is increased by 20/- per ton how would that increase the cost of housing?
Two and a half per cent. In regard to Deputy McGilligan's final point I would only say that ordinarily a person who had a licence to manufacture cement subject to a maximum price and who exceeded that price would first of all have to be convicted of that offence in court. He would, no doubt, appeal from the minor court to a higher court. On conviction his licence could be withdrawn; in which eventuality we would have to make other provision to supply the requirements of the country. That would be to allow imports to take place until some other provision had been made.
Suppose a man in Mullingar wants a large quantity of cement and some of the Deputies representing Galway complain to the Minister that there is a considerable volume of unemployment there on the quays, and say that the cement for Mullingar must be imported through Galway and the Minister gave a licence to import through Galway, what is the man in Mullingar to do?
That cannot arise at all.
When you get into licensing, as the Minister for Local Government told us last night, politics will enter into everything and politics will enter into cement. That is what all of us dread. Let us face these difficulties of licensing after the factories are in a position to deliver cement of a satisfactory character, but until that time let us enjoy all the advantages of a free market.
The Deputy meddles in politics himself sometimes.
I think it should be made clear that we do not all accept Deputy McGilligan's claim as to the low price at which we get cement at the present time.
I was quoting the Minister.
I do not think anybody is in a position to say at what price we are getting cement. To the ordinary man in the street it may seem that we are sending out banknotes and Treasury notes for our cement, but Deputy McGilligan knows and everyone here knows that we are paying for our cement with sheep, cattle, eggs and butter.
No, not butter surely.
Which of these things is being produced at a profit at the present time? Surely when you have a situation like that where you are exchanging goods which have not been produced at a profit for other goods which are being sold below the cost of production, you would require to be a very brilliant accountant to be able to strike a balance and say with safety that either you are getting your cement at a reasonable price or at a sacrifice price on the part of those who are selling it to you, or at too dear a price on the part of those who are purchasing? Particularly is that so when Deputy McGilligan relates this question to the cost of house building. House building for the populace is being done by the State with public money. While to the individual, who is importing cement, and using it for production purposes, it might seem that he is under a hardship in having to pay a higher price, the State is affected by the situation I have just described. Who is to tell us that the State is under a disadvantage in having to pay that higher price in these circumstances?
I should not like to answer Deputy Moore in detail but I should like him to consider this. We are paying, possibly in goods that are being produced here, a price which we do not get eventually. We are selling at lower than the cost of production. We are paying that in any event. That is our method of payment. That stands against the cement so that we can leave that out. Would Deputy Moore rather buy goods which are being sold here under the cost of production in the country of production, or goods which are being raised artificially in price. Which has the better profit for him?
Question—"That Section 21 stand part of the Bill"—put and agreed to.
Sections 22 to 24 inclusive, ordered to stand part of the Bill.
Question proposed: "That Section 25 stand part of the Bill."
I should like to get some information from the Minister in regard to this section. The section says: "There shall be payable in respect of every import licence a fee calculated by reference to the number of tons of cement authorised by such licence to be imported and at such rate per ton as the Minister may, with the concurrence of the Minister for Finance, fix in respect of such licence." Can the Minister give some information as to what the volume of this tax is going to be?
No. The position is as I stated. On the passing of the Act the fee will be small. The amount will be so small as to be negligible. That fee will be operated to maintain uniformity of price and mainly for that purpose, subject, of course, to the possibility of the whole plan being used to direct trade into particular channels. I do not contemplate that we will have home-produced cement for more than 12 months ahead so that any question of raising the price of cement gradually, so as to have an even break into the use of Irish cement, would scarcely arise for some months to come but I do not contemplate that there will be any increase in the price of cement for a considerable period and possibly not at all.
The Minister says now that he is going to level up the price of cement at a standard figure——
That statement, of course, is based on two assumptions. One is that cement produced here will be dearer than the cement that is now being imported and the second is that cement will continue to be imported at the same price at which it is now available. One cannot see 18 months ahead and say that these two conditions are going to continue.
This is more of the element of uncertainly that adds to the difficulty that the Minister quite recognises in connection with a big industry. You are dealing with very big industries in the building and allied industries which employ something like 80,000 people, and even ten per cent unemployment means 8,000 unemployed, so that one must be really careful in dealing with an industry of that magnitude and in seeing what are the reactions on it. For that reason, I am anxious to get from the Minister something that will do away with the element of uncertainty that is having its reactions at the moment.
I am afraid it cannot be done. I will say this, that the price of cement will be no more uncertain in future than it was a month ago and the Deputy knows that a month ago the price at which cement might be offered for a particular contract could not have been estimated and was frequently reduced after the first tender had been submitted.
I can tell the Minister that there was no difficulty whatever in fixing the price of cement when estimating for building, but, when you pass this Bill, I see very great difficulty. I see a further difficulty in the economic argument of the Minister. The Minister says we are going to sell our commodities to certain countries and take from those countries cement in return. If you are going to limit the purchase of cement to certain countries, it is very hard to know what it is going to cost.
It is not likely that we will do that.
The Minister has explained that in the course of his economies to-night. All these things are adding difficulties to a big industry and, I am afraid, to unemployment, and I am anxious that the Minister, when he looks into the matter, would agree to leave over this whole question of licensing for the time being. Let us face the problem as soon as we have a commodity of our own, but, until that period arrives, let us enjoy all the benefits that we can get from other countries through a cheap supply of cement. We do not produce it here. Let us get every advantage we can through taking it from other countries at a price very considerably lower than the cost of production.
Section 25 to 27, inclusive, agreed to.
Question proposed: "That Section 28 stand part of the Bill."
Application by the licensee is the only condition of revocation?
Yes. A licence, once granted, cannot be revoked.
Question put and agreed to.
Question proposed: "That Section 29 stand part of the Bill."
What does this section mean?
It makes it illegal to import cement without a licence and brings in this reference to the Customs (Consolidation) Act, 1876.
Would it not be illegal without Section 29?
Apparently not. I am afraid I cannot really explain it. This section always appears whenever there is a legislative provision for the purpose of making it illegal to import without a licence or something of the kind.
Question put and agreed to.
Bill reported without amendment.
Final Stage fixed for Friday, 25th May.